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Platinum Group Metals Ltd. Message Board

  • hockeyguy548 hockeyguy548 Mar 24, 2013 8:11 AM Flag

    Natixis: Technical Analysis for Platinum

    Platinum prices dropped to a year low of $1,550/oz, which is also our estimate of the breakeven price of the metal for South African producers. At the same time, energy issues in the country helped to illustrate the significant cost pressures faced by miners in the country. The strike at coal producer Exxaro is putting a strain on Eskom; Exaxaro provides coal to Matla and Arnot power stations, which in turn account for 10% of Eskom’s generation capacity. Although Eskom said on Monday that it had 49 days of coal stocks, it also reported that it had a buffer of just 480MW between available capacity (including gas-fired emergency reserves) and peak demand, implying that spare capacity was just over 1%. As a result, South Africa changed its power alert to red, indicating a major strain on the electricity supply.

    As we noted last week, during the month of February automobile sales in BRIC countries dropped by 8% yoy (to 1.76mn units). Lower automobiles sales in China, resulting from the New Year holidays being the main force behind this drop. During February, sales in the G3 area dropped by 4% yoy to 2.27mn units. Growth in sales in the US slowed to 4% yoy (1.18mn units) in February, the lowest yoy growth figure since April 2012. At the same time, automobile sales in Japan dropped by 12% yoy to 292,400 units and sales in Europe continued their worst start to the year in decades; automobile sales in Europe dropped by 11% yoy to 795,500 units.

    Technical Analysis

    It cannot be ruled out the precious metal will extend its decline and test the support at 1,536 (weekly parabolic). A pullback below this level is unlikely, however, given that weekly volatility is tending to subside and that the weekly stochastic is in oversold territory. Under these conditions, there should be a recovery towards the first resistance at 1,610 (weekly Bollinger moving average). A breakout above this level would release new upward momentum towards the resistance at 1,651 (Fibonacci projection)

1.210.00(0.00%)Jul 11 4:00 PMEDT

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